Coinbase Raises US$75 Million in Largest VC Investment into Bitcoin Startups So Far
Popular wallet and online payment platform Coinbase has raised US$75 million in a series C funding round.
Popular wallet and online payment platform Coinbase has raised US$75 million in a series C funding round. Arriving on top of US$30 million raised in series' A and B, the company is now being valued by the investors at around US$400 million.
“Investors included banks and the New York Stock Exchange, apparently the first time any traditional financial institutions have taken direct stakes in a bitcoin enterprise.”
Coinbase has raised a total of US$112 million. WSJ says the latest investment may represent “a new front for Bitcoin,” as the news comes at a particularly difficult time for the price of the cryptocurrency against the dollar. The news may calm investor nerves. Coinbase CEO Brian Armstrong told WSJ said that he doesn’t worry about the price and he tells his team:
“Try to have your blinders on. Do one thing every day to move the ball, and we’ll have the last laugh on this thing.”
The investment of US$75 million into the digital currency platform represents the single largest venture capital investment into a Bitcoin company, and more than doubles the previous largest round raised.
One of the investors, former Thomson Reuters CEO Tom Glocer, stated that putting money in a company like Coinbase is “a better way to bet than investing directly in the currency.” He echoes similar sentiments of Magma Ventures, who stated following their first investment in a Bitcoin company earlier this month that they also “weren’t investing in Bitcoin, but in the blockchain and what it enables.”
Armstrong said the deal is “less about money and more about relationships.” Institutions like the NYSE “want a portal into what’s happening” in Bitcoin.
Tim Draper, one of Bitcoin’s most well-known investors, said the news is “incredibly exciting.” He continued:
“Finally, bitcoin is being recognized as a great vehicle for banking. It is clear that not only can bitcoin be used for remittances and stored value, but also for banking efficiency and credit card transactions.”
In mid-2014 Coinbase's rivals BitPay had made headlines by raising US$30 million in a funding round backed by Index Ventures, Richard Branson, and Yahoo co-founder Jerry Yang, a similar amount was also raised in Blockchain's US$30.5 million round led by Lightspeed Venture Partners. Coinbase was first reported to be looking for this funding in November 2014, initially seeking a sum rumored to be around US$150 million, a figure which proved unattractive to investors at the time.